John Major could scarcely have delivered a more upbeat message to the City in his Guildhall speech last night: 1997 would see the "most secure economic base for generations ..." Britain was "back in the first rank". There was a clear sub-text here; the feel-good factor is back, and with it the prospects of a Tory victory next year. What's more, a lot of the hard figures back up his optimism. So how worried should Labour be that its commanding lead is about to slip away?

On one analysis, not much. The polls show an unprecedented disjunction between economic optimism among the electorate and its willingness to vote Tory.

In the past, as economic prospects improved, people became more supportive of the government. That relationship has broken down. Last month's MORI poll for The Times showed that the so-called economic optimism index had fallen from 10 per cent to only -1 per cent since the first half of the year. Yet the same poll still gave Labour an awe-inspiring 28-point lead.

This has been worrying the Tories for months, and is usually attributed to the lasting blow to Tory credibility suffered when Major was ignominiously forced out of ERM in 1992. But it may also simply be that, having repeatedly told the voters that the recession was caused by international factors entirely beyond their control, ministers are now having a hard time persuading the same public that the recovery, by contrast, is all because of the brilliance of the Government.

Second, Labour is much less vulnerable to the charge that it would ruin an economic recovery through high taxes than it was before the 1992 election. Tony Blair and Gordon Brown have been zealous in shedding Labour's tax- and-spend baggage. And as part of its softening-up process for the Budget, Labour will this week start reminding the voters again how far taxes have gone up, before Clarke starts to bring them down again.

Finally, there is a heretical but, to some, seductive argument that electors are more likely to vote Labour in an economic recovery than in a recession. In the Labour post-mortem examination after its 1992 defeat, some of the then Shadow Chancellor John Smith's aides argued that voters are more comfortable voting for redistribution when the country can afford it. This was rejected by Brown and Blair - and by John Smith, when he became Labour leader - as a distraction from what they, by contrast, saw as the central lesson of the 1992 defeat: the part played in it by Labour's tax and spending commitments.

Labour need not panic over the prospects of a steadily improving economy between now and polling day. But that doesn't mean that it can be complacent, either. First, it can't be quite sure that the ERM debacle is the only reason the Tories aren't reaping the benefit of economic optimism. It may be, as Michael Dicks of Leaman Brothers argued last month, as much to do with negative equity. You can't reverse the 1992 devaluation. But a housing mini-boom could unlock negative equity, and with it some more Tory votes.

Labour also knows that the markets will allow the Tories somewhat more fiscal "irresponsibility" than they would a Labour government.This poses a dilemma for Labour: Blair and Brown are genuinely sceptical about how real are the spending cuts Clarke will announce; they have already spent a lot of time pointing out that public borrowing has doubled since John Major came to power; they worry that privatisation receipts - for example of housing association debt or MOD homes - are one-offs for which the next government will have to pay a price.

But criticising the Government for conducting an irresponsible "scorched earth" policy can be dangerous, and not only because it sounds Eeyore- ish, just when everyone is feeling better. For what are they supposed to say they would do instead? Produce deeper cuts in spending? Hardly an electoral rallying cry. Raise more taxes? Unthinkable for new Labour. What's more, the more they attack the Government for mismanaging the economy now, the more they may be building up trouble for themselves if they win. As Harold Wilson found in 1964, the worse you say things are before an election, the more the markets expect you take drastic and unpalatable action when you get in.

So Labour has to play it cool. Ideally, perhaps, Labour would prefer an election now, before the feel-good factor has any more chance to play into the polls. But that isn't going to happen. Labour will not get drawn into playing alternative budgets with Ken Clarke. It will continue to attack the Tories for Britain's long-term failure to invest. And it will continue to implement Tony Blair's latest exhortation to his colleagues: the "three Rs" are reminding voters of the pain they have suffered under the Tories in the past; reassuring them that Labour is not going back to its old ways (as Brown did his best to do yesterday on inflation); and rewarding them with the promise of a better quality of life.

It may be that the link between economic optimism and Tory support has irrevocably broken down for the Government, however shrewd a budget Ken Clarke produces. It's a worry that still haunts the Tories. But if it hasn't, there are no quick fixes; there's no turning back from the strategy already set by Brown and Blair.